Following the lackluster performance seen in the previous session, stocks moved mostly higher over the course of the trading day on Wednesday. The major averages all climbed to new record closing highs after ending mixed for two straight days.
The tech-heavy Nasdaq led the way higher, jumping by 254.21 points or 1.3 percent to 19,735.16. The Dow also advanced 308.51 points or 0.7 percent to 45,014.04, while the S&P 500 climbed 36.61 points or 0.6 percent to 6,086.49.
The rebound by the Dow came amid a sharp increase by shares of Salesforce (NYSE:CRM), with the enterprise software company surging by 11.0 percent after reporting better than expected fiscal third quarter revenues.
Chipmaker Marvell Technology (NASDAQ:MRVL) also soared by 23.2 percent after reporting fiscal third quarter results that exceeded estimates, contributing to strength in the tech sector.
Optimism about the outlook for interest rates also contributed to the strength on Wall Street following the release of some weaker than expected U.S. economic data.
Payroll processor ADP released a report this morning showing private sector employment in the U.S. increased by slightly less than expected in the month of November.
ADP said private sector employment climbed by 146,000 jobs in November after jumping by a downwardly revised 184,000 jobs in October.
Economists had expected private sector employment to grow by 165,000 jobs compared to the surge of 233,000 jobs originally reported for the previous month.
A separate report released by the Institute for Supply Management showed U.S. service sector growth slowed by more than anticipated in the month of November.
The ISM said its services PMI fell to 52.1 in November from 56.0 in October. While a reading above 50 still indicates growth, economists had expected the index to show a much more modest decrease to 55.5.
Following the data, CME Group’s FedWatch Tool is indicating a 75.5 percent chance the Federal Reserve will lower interest rates by 25 basis points later this month.
During remarks later in the afternoon, Fed Chair Jerome Powell reiterated the central bank will take a cautious approach to cutting rates due to the continued strength of the economy.
Sector News
Airline stocks moved sharply higher over the course of the trading session, with the NYSE Arca Airline Index soaring by 2.9 percent.
Substantial strength was also visible among computer hardware stocks, as reflected by the 2.8 percent surge by the NYSE Arca Computer Hardware Index.
Pure Storage (NYSE:PSTG) helped lead the sector higher, spiking by 22.1 percent after reporting better than expected fiscal third quarter results.
Software, semiconductor and biotechnology stocks also saw considerable strength, contributing to the jump by the tech-heavy Nasdaq.
On the other hand, energy stocks moved sharply lower along with the price of crude oil, while housing stocks also saw notable weakness.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan’s Nikkei 225 Index inched up by 0.1 percent, while China’s Shanghai Composite Index fell by 0.4 percent.
The major European markets also ended the day mixed. While the U.K.’s FTSE 100 Index dipped by 0.3 percent, the French CAC 40 Index climbed by 0.7 percent and the German DAX Index jumped by 1.1 percent.
In the bond market, treasuries recovered from early weakness and climbed firmly into positive territory over the course of the session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, fell 4.3 basis points to 4.180 percent after reaching a high of 4.281 percent.
Looking Ahead
A report on weekly jobless claims may attract attention on Thursday, although activity may be somewhat subdued ahead of the release of the more closely watched monthly jobs report on Friday.
SOURCE: RTTNEWS